It's time to rethink pre-pay (20% of your customers may soon ask for it)
Quick Take: A new consumer survey from management consulting firm DEFG EcoAlign suggests it is time for North American utilities to rethink their traditional opposition to prepaid plans.
"The top line findings from the report clearly indicate that consumer use and satisfaction with prepay in all forms is increasing," says CEO Jamie Wimberly "We are predicting that 2014 will represent an inflection point for prepay energy."
And that's not all they are predicting. "Up to a fifth of a utilityâ€™s customer base could switch to a prepay account within a few years." Even if he's only half right, it sounds like it's time to pilot a program in your territory. - By Jesse Berst
Prepay Energy at an Inflection Point for Rapid Adoption in the Utility Sector
DEFGâ€™s EcoPinion Survey Points to Growing Consumer Interest
DEFG, a management consulting firm specializing in energy (www.defgllc.com), released today EcoPinion No. 18, â€œPrepay Energy at an Inflection Point.â€ DEFG worked with a broad array of market participants and public stakeholders through the Prepay Energy Working Group in late 2013 to survey 1,000 consumers. The national survey examined consumer perceptions and satisfaction levels with prepaid options in general, and took a more in depth look at consumer awareness and acceptance of prepaid electricity service.
â€œThere is compelling evidence that a growing number of Americans are very interested in a prepay energy offering as a voluntary bill pay option,â€ stated Jamie Wimberly, CEO of DEFG. â€œIt helps them to understand and control their usage, and manage their home budget. We believe that 2014 will be a critical year for the prepay energy market.â€
The primary findings from the consumer survey are:
â€¢ Prepay in all its manifestations, e.g., reloadable debit cards, gift cards, etc., is part of an intensifying mega-trend in consumer finance.
â€¢ Prepayment is not limited to low income consumers. It has gone mainstream with over two-thirds of Americans currently using some form of prepay.
â€¢ Americans are satisfied with prepayment. In 2013, 75% of Americans surveyed were either â€œvery satisfiedâ€ or â€œsomewhat satisfiedâ€ to make purchases or contract for services using prepayment. Younger, mobile Americans were especially well satisfied.
â€¢ The percentage of Americans interested in a voluntary prepaid energy option increased by 3% from 2012 to 2013. Since 2010, those who are â€œextremely interestedâ€ or â€œvery interestedâ€ has increased 7 points, from 17% in 2010 to 22% in 2012 to 24% in 2013.